Sam Bankman-Fried, founder of the collapsed FTX exchange, has paid $10 million to his legal defence counsel using stolen funds, it is alleged.
The 31-year-old disgraced entrepreneur has been accused of funding his legal team with millions taken from FTX’s hedge fund – Alameda Research – which was said to have been gifted by Bankman-Fried’s father – Stanford University law professor Joseph Bankman.
A new lawsuit, filed in Delaware, claims a ‘Bankman Gift Transfer’ was made from his own FTX account to his “father’s personal account on the FTX US exchange”.
“On information and belief, Bankman-Fried’s father has been using this ‘gift’ to finance Bankman-Fried’s criminal defense,” the lawsuit states.
Documents allege Bankman-Fried transferred sums to his father in January 2022, after initially moving the $10 million “containing debtor assess” to an account under his own name. It claims the $10m was then transferred to Joseph Bankman moments later.
“In an email exchange, Bankman-Fried and his father discussed structuring the $10 million gift as a loan from Alameda to Bankman-Fried,” the document adds.
Lawyers acting for investors in the FTX exchange are currently pursuing a slew of charges against Bankman-Fried and co-founder Gary Wang, director Nishad Singh and former Alameda CEO Caroline Ellison.
Damages estimated at $1 billion are being sought.
Background on the FTX case from Crypto AM…